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An Introduction to the Dominican Republic

A. History of the Dominican Republic B. Economic Structure of the Dominican Republic

III. The Legal Framework for Investment

A. The Constitution of the Dominican Republic: The

Road to Governability 1.The Supremacy of the Constitution 2.A Socially-Conscious Democratic Government Respectful of the Rule of Law: National Territory 3.Natural Resources 4.Dominican Nationality 5.Equal Treatment of Foreign Nationals 6.Membership in the International Community and Submission to Arbitration 7.Human Rights 8.Social and Economic Rights 9.New Constitutional Rights 10.The Legislative Branch 11.The Executive Branch 12.The Judicial Branch 13.The National Council of Magistrates 14.The Constitutional Tribunal 15.Economic Affairs 16.Constitutional Amendments B. Foreign Investment 1.Statutes Governing Foreign Investment in the Dominican Republic a. Law No. 16-95 on Foreign Investment in the Dominican Republic b. Law No. 98-03: Center for Export and Investment of the Dominican Republic

(CEI-RD) Centro de Exportacin e Inversin De La Repblica Dominicana c. Regulation No. 214-04 on the Registration of Foreign Investments in the Dominican Republic 2.Sectors of the Economy Open to Foreign Investment 3.Types of Foreign Investment 4.Benefits Obtained by Registering a Foreign Investment 5.Procedure for the Registration of Foreign Investment 6.Foreign Investment Under DR-CAFTA C. Free Zones 1.In General 2.Types of Free Zones 3.Investment in the Free Zone Sector. Free Zone Enterprises and Free Zone Parks 4.Special Advantages and Benefits a. Incentives and Exemptions b. Special Import Duty Treatment c. Sectors of National Priority d. Special Rules of Labor Law 5.Requirements to Set Up a Business in a Free Zone D. Telecommunications 1.Introduction a. Historical Background b. Liberalization and Competition c. The General Law of Telecommunications d. Objectives e. Other General Principles 2.Classification of Telecommunications Services

Authorizations b. Types of Authorizations i. Concession ii. Inscription in a Special Register c. Procedure to Obtain Authorizations d. Foreign Investment e. Governing Agency f. Objectives, Functions and Composition g. Universal Access and the Fund for the Development od Telecommunications h. Management of the Radio-Electrical Spectrum i. Decisions and Appeals j. System of Penalties 3.Taxation of Telecommunications a. Contribution for the Development of Telecommunications (CDT) b. Excise Tax (Selective Tax on Consumption) c. Value-Added Tax (ITBIS) d. International Treaties and Agreements Relative to Telecommunications E. Civil Aviation 1.Jurisdiction a. Generalities b. General Requisites for Flying 2.Agencies Governing Civil Aviation a. The Dominican Institute of Civil Aviation b. The Civil Aeronautics Board 3.Regulation of Aircraft a. Registration b. The National Aircraft Registry c. Contracts for the Use of Aircraft and Commercial Cooperation Agreements

4.Licenses, Certificates and Permits

Licenses, Certificates and Permits Issued by the Dominican Institute of Civil Aviation (IDAC) b. License, Certificates, and Permits Issued by the Civil Aeronautics Board (JAC) 5.Classification of Air Services a. Commercial Aviation b. Non-Commercial Aviation 6.Civil Aviation Under DR-CAFTA F. Port Authority 1.The Dominican Port Authority 2.Ship Mortgages. Registration G. The Energy Sector 1.The Electrical Subsector a. The General Electricity of Law b. The Institutional Framework c. Concessions and Permits d. Independence of Each Sector e. Determination of the Price of Electricity f. The Renewable Energy Law i. Scope of Application ii. General Incentives for the Production and Use of Renewable Energy 2.The Hydrocarbon Subsector a. Institutional Framework b. Licenses for the Importation, Storage, Transportation and Distribution of Fuels for the Operation of Service Stations and the Sale of LPG c. Import Quotas d. Quality of Fuels e. Regulations of Prices and Resale Margins

i. The Import Parity Price (the IPP) ii. Margins for Distribution and Retailers iii.Transportation Fee for Fossil Fuels f. The Fuel Sector and DR-CAFTA H. Tourism Sector 1.Regulations of Tourist Establishments and Services a. Hotels b. Gift Shops c. Restaurants d. Travel Agencies e. Tourism Transportation f. Casinos and Gambling 2.Law No. 158-01 to Promote Tourism in Underdeveloped Areas a. Objectives of the Law b. Areas Covered c. Tourist Activities d. Incentives and Benefits Granted by the Law e. Classification of Tourist Projects 3.Resolution No. 9-2001 Governing of TimeShare Projects I. The Construction Sector 1.Applicable Legislation a. Lots b. Removal of Pavement c. Housing Developments d. Construction of Sidewalks e. Safety Measures in Construction f. Governing Bodies i. Buildings Department ii. Department of Regulations and Systems

iii.Office of Processing of Construction Plans g. Urban Planning Department h. Permits and Licenses i. Land Use Permit ii. Construction License iii.Processing Applications for Projects i. Demolitions j. Remodeling and Annexes J. Real Estate Law 1.Agencies Dealing with Real Property a. The Superior Land Courts b. Original Land Courts c. Title Registration Department d. National Cadastral Surveys Department e. The State Attorney 2.Formula Requirements for Documents 3.Substantive Requirements for Documents 4.Procedures Before the Real Property Agencies a. Determination of Metes and Bounds b. Proceeding to Register Land for the First Time i. Steps in Proceeding to Register Land 1.Determination of Boundary 2.Judicial Proceeding 3.Registration 4.Publicity of Property Rights 5.Notations to a Certificate of Title (Constancias Anotadas) 6.The Certificate of Title a. Inscriptions of Certificates. Complementary Registrations

Issuance of Certificates. Duplicates c. Loss of Certificates 7.Improvements 8.Condominiums a. Condominium Regulations 9.Guaranty Fund for Registered Properties 10.Public Property 11.Fees for Services

K. The Mining Sector. 1.The Legal Framework

The Mining Law and Its Regulations b. Law No. 123 c. Environmental Norm for Mining Operations 2.The Institutional Framework a. The Mining Department b. The Mining Corporative Unit 3.Investment in the Mining Sector 4.Procedures Prior to Operating in the Mining Sector a. Prospecting b. Exploitation Concessions 5.Taxation of the Mining Sector 6.The Mining Sector and DR-CAFTA L. The Agricultural Sector 1.The Statutory Framework 2.Agricultural Promotion 3.Agricultural Financing. 4.Storage of Agricultural Commodities 5.Agriculture and DR-CAFTA M.Pharmaceutical Sector 1.Characteristics of the Sector a. Brief Description

Social and Economic Importance c. Agencies Governing the Sector 2.The Legal Framework a. The Dominican Constitution b. General Heal Law No. 42-01 and Complementary Norms i. Objectives and Scope of Application ii. Relevant Complementary Norms iii.Regulation of Activities iv.Law No. 50-88 on Narcotic Drugs and Controlled Substances, As Amended v. Medicines and DR-CAFTA c. Procedures for Establishment of Pharmaceutical Enterprises d. Approval Procedure for Marketing Health Products i. Requirements for Obtaining Health Registration ii. Procedures for Obtaining Health Registration N. Investment Guaranties and Financing 1.The Multilateral Investment Guarantee Agency (MIGA) a. The Ordinary Program i. Risks Covered Under the Policies ii. Insurable Investments iii.Insurable Investor iv.Terms and Conations b. Programs for Small Investments (PSI) i. Risks Covered ii. Insurable Investments Under PSI iii.Insurable Investors in Small or Medium-Size Enterprises

iv.Terms and Conditions v. Resolution of Disputes 2.Overseas Private Investment (POIC) a. Function b. Investment Insurance 3.Agreements for Reciprocal Promotion and Protection of Investments 4.Agreements for the Avoidance of Double Taxation 5.International Organization Providing Project Finance a. Investment Funds b. The World Bank c. The Inter-American Development Bank (IDB) d. The European Investment Bank (EIB) e. Overseas Private Investment Corporation

IV.Legal Framework for Business Activity

A. Types of Business Organization 1.The Company Law and Its Amendment

b. c. d. e. f. g.

Introductory Rules Relating to Companies i. Articles ii. Registration iii.Capital iv.Shares Adaptation and Transformations Formation of a Company Issuances of Shares Issuance of Debentures or Bonds Conduct of Shareholders Meetings Management i. Avoiding Conflicts of Interest

ii. Records of Operations, Financial Statements and Supporting Documents iii.Access to Financial Information and Supervision iv.Annual Report on Management, Distribution of Dividends and Legal Reserve v. Removing the Corporate Veil B. Rules Applicable Specifically to Certain Types of Companies 1.Limited Liability Companies (Sociedades de Repsonsabilidad Limitada or S.R.I) a. Minimum Capital b. Transfer of Shares (Cuotas) c. Management 2.Corporations (Sociedades Anonimas or S.A) a. Minimum Capital b. Transfer of Shares c. Management d. Supervision 3.Simplified Corporation (Sociedad Anonoimas Simplificadas or S.A.S) Error of Instead of or) a. Capital b. Shares c. Management d. Supervision e. Shareholders Meetings 4.Silent Joint Ventures (Sociedades Accidentales o en Participacon) 5.Limited Proprietorships (Empresas Individuales de Responsabilidad Limitada EIRL)

6.Establishment of Branches of Foreign

Companies (Error 14.2 Should Be 14.3) 7.Joint Ventures and Consortiums (Same Problem) C. Taxation 1.Income Tax a. Natural Persons b. Legal Entities, Business Proprietorships and Decedent Estates 2.Assets Tax 3.Tax on the Transfer of Industrialized Goods and Services (ITBIS) 4.Capital Gains Tax 5.Real Estate Tax 6.Other Taxes a. Excise Taxes b. Tax on Motor Vehicles 7.Tax Incentive Laws a. Tourism b. Industrial Sector c. Renewable Energy d. Development of Border Areas 8.Free Trade Agreements 9.Agreements for the Avoidance of Double Taxation 10.Tax Information Agreement with the United States D. Labor Law 1.Legal Norms 2.Principles of Territoriality 3.The Principle of Public Order in Labor Legislation Ad the Rule Favoring Employees 4.Formation of the Employment Contract 5.Different Types of Employment Contracts 6.Salary

7.Minimum Wage 8.Overtime 9.Weekly Time of Rest and Legal Holidays 10.Vacations 11.Christmas Bonus 12.Profit Sharing 13.Limits on the Use of Foreign Workers 14.Temporary Lay-offs 15.Termination of the Labor Relation

Termination without Liability b. Termination with Liability c. Severance Pay 16.Maternity Benefits 17.Unionization 18.Job Training 19.Administrative Obligations 20.Transfer of Employees 21.Administrative Agencies 22.Labor Courts and Labor Procedure 23.The Effect of DR-CAFTA in Labor Relations E. Social Security 1.Leading Principles of the Dominican Social Security System 2.Financing of the Dominican Social Security System 3.Affiliation and Contributions to the Dominican Social Security System a. Affiliation b. Contributions 4.Payments Made by the Social Security System a. Insurance Against Old Age, Disability and Survivorship b. Family Health Insurance c. Insurance Against Work-Related

Injuries and Illnesses F. Special Benefit for Pensioned or Retired Persons Receiving Income from Abroad 1.Introduction 2.Qualifications of Pensioners 3.Benefits Under Law 4.Penalties G. Industrial Property 1.Patents Utility Models and Industrial Designs (Weird) a. Concept of Invention b. Concept of a Utility Model c. Concept on an Industrial Design d. Statutory Basis e. Membership in International Conventions f. Life of a Concession g. Civil Action 2.Trademarks and Service Marks a. Concept and Types or Marks b. Statutory Basis c. Membership in International Conventions d. Life of a Trademark e. Administrative Proceeding and Criminal Penalties 3.Competent Authority in Matters of Intellectual Property 4.Domain Names 5.Protection of Species of Vegetation H. Copyright and Related Rights 1.Copyright and Related Rights a. Acquisition of Copyright b. Extent and Content of Copyright c. Special Provision for Certain Types of

Work d. Limitations and Exceptions to Copyright e. National Treatment, Automatic Protection and Independence of Protection f. Duration of Protection g. The Public Domain h. Collective Management Societies i. Border Enforcement j. Civil Actions and Penalties k. Copyright Agreements to which the Dominican Republic is a Party I. Legislation on Electronic Commerce, Documents and Signatures 1.Legislation a. General Aspects b. Digital Documents and Data Messages c. Electronic Commerce in the Transportation of Goods d. Digital Signatures, Certificates and Certifying Entities e. Agency in Charge of Regulating Electronic Commerce 2.Norms Related to the Technological and Security Standards in Electronic Commerce 3.Completer Legal Aspects a. Determination of the Official Time by Electronic Means b. Protection of Personal Data by Regulated Subjects c. Norms Relating to the Publication of Information About Consumer and Users by the Regulated Subjects d. Protection of the Rights of Consumers and Users

Use of Data Messages, Digital Documents and Signatures in Relation to Electronic Payments J. Technological Crimes and Misdemeanors 1.General Aspects of the Law on Technological Crime and Misdemeanors 2.Rules of Substantive Criminal Law 3.Ordinary Crimes Committed by Technological Means 4.Intellectual Property Crimes 5.Crimes Against Telecommunications 6.Crimes Against the Nation and Acts of Terrorism 7.Investigative Agencies 8.Procedural Rules K. Legislation on Agents and Distributors of Imported Goods and Services L. Legislation on Government Procurement 1.Legal Framework 2.Government Procurement System 3.Principles of Government Procurement 4.Government Agencies Subject to Law 5.Contracts to which the Legislation on Government Procurement Rights a. Contracts which Are Expressly Excluded b. Contracts Subject to a Special Regime 6.Procedures for the Selection of Contractors a. Compulsory Public Bidding b. Direct Procurement 7.Requirements for a Government Contractor a. Technical Expertise for Certain Contract b. Inscription in the Registry of Government Suppliers i. Registration of Foreign Firms ii. Documents Required for

Registration 8.Administration and Judicial Controversies

M.Legislation on Environment and Natural

Resources 1.Law No. 64-00 on Environmental and Natural Resources a. Objective b. The Regulating Agency c. Environmental Permits and Licenses 2.Environmental Permits and Licenses for Existing Installations a. Requisites b. Prior Analysis c. Environmental Report d. Environmental Management Program e. Follow-Up and Control 3.Environmental Permits and Licenses for New Projects a. Requirements b. Assessment of Environmental Impact and Projects Subjected to That Requirement c. Declaration of Environmental Impact d. Environmental Impact Study 4.Authorization for the Use of Soil and Water a. Authorization for the Extraction of Materials from the Soil b. Other Authorizations i. Construction of Wells to Remove Subterranean Water ii. Permission to Discharge Liquid Waste iii.Change of Use of Soil 5.Authorization of the Use of Forestry

Resources a. Cutting Trees b. Other Authorizations i. For the Establishment of Lumber Industries ii. Importation of Lumber 6.Protected Areas and Biodiversity a. Protected Areas i. Permits for Study and Research ii. Permits for Eco-Tourism in Protected Areas b. Biodiversity i. Permit to Import or Export Wild Plants or Animals for Commercial Purposes 7.Marine and Costal Resources a. Fishery i. Authorization to Import or Export Fish ii. Marketing License for Fishery Products b. Other Authorizations i. Investment Projects Along the Coast ii. Licenses for Fish-Farming iii.Use, Export or Marketing of Live Costal or Marine Resources 8.Accreditation of Environmental Consultants 9.The Constitution of the Dominican Republic 10.The Effect of DR-CAFTA N. Family Law and Law of Successions 1.Family Law a. Marriage and Domestic Partnership b. Economic Relationship Between the Spouses

i. Types of Community Property ii. The Separate Property Regime c. Divorce i. Divorce by Mutual Consent ii. Grounds for Divorce iii.Quickie Divorces for Foreigners d. Fundamental Rights of Children and Adolescents i. Legal Age ii. Custody iii.Child Support iv.Authorization to Travel v. The Hague Convention of 1980 on the International Removal of Children e. Adoption i. Convectional Relative to International Removal and Adoptions f. Family Meditation Center 2.Law of Successions

V. Competition & Competitiveness

A. Legislation on Unfair Business Practices and The

Defense of Competition 1.Legislation on Unfair Business Practices and Safeguarding Measures a. Unfair Business Practices b. Safeguarding Measures 2.Legislation for the Defense of Competition B. Consumer Protection Law 1.Protection of Health and Safety 2.Protection of Economic Interests 3.Information and Education 4.Right of Defense and Association

5.Obligations of Suppliers 6.Violations 7.Administrative Proceeding 8.Conditions and Arbitration 9.Judicial Action C. Legislation on Competitiveness and Industrial

Innovation 1.Benefits of an Industrial Classification a. Customs Duties Exemptions b. Exemption from Local Taxes c. Reimbursement to Exporters d. Partial Processing e. Development of Industrial Parks f. Industrial Innovation g. Industrial Renewal and Modernization D. Corrupt Business Practices 1.Bribery a Crime Under Law No. 448-06 a. Taking Bribes b. Committing Bribery c. Transnational Bribery d. Complicity

VI.Cross-Border Trade Regime

A. Customs Clearance 1.The Bureau of Customs: Power and

Jurisdiction 2.Determination of Customs Duties 3.Protection of Intellectual Property 4.Administrative Violations and Penalties 5.Appeals 6.Crimes and Penalties 7.Customs Duties a. Import Duties

Exports c. Temporary Import and Export i. Temporary Import of Material for Processing ii. Temporary Export iii.Transformation of Merchandise for Local Consumption iv.Temporary Import of Merchandise v. Return of Repaired or Altered Goods vi.Customs Warehouses 8.Time for Customs Clearance B. Law on International Financial Zones 1.Purpose 2.Institutional Framework 3.Systems of Prior Authorization 4.Permitted Activities a. Financial and Related Services b. Support Services 5.Benefits Enjoyed by Users and Operations in the IFZs C. The World Trade Organization (WTO) 1.Background 2.Rounds of Trade Negotiation 3.The Trade Negotiations Conducted Under the Auspices 4.The Doha Round 5.Basic Rules of International Trade 6.Preferential Agreements within the Framework of WTO-GATT 7.Article XXIV of GATT 8.Preferential Treatment for Developing 9.Countries 10.Unilateral Preferences D. Position of the Dominican Republic in the System

of Multilateral and Regional Preferences 1.The Multilateral System 2.Special Preferential Programs 3.The Agreements of Lom-Cotonou E. The Dominican Republic-Central America Free Trade Agreement with the United States (DRCAFTA) 1.General Aspects 2.Trade and Investment a. Market Access b. Trade Facilitation c. Government Procurement d. Investment e. Services f. Intellectual Property Rights 3.Dispute Settlement 4.Administration of DR-CAFTA F. Economic Association Agreement Between the European Union and Cariforum 1.Background 2.Purpose and Objectives 3.Regional Arrangements 4.Free Trade Agreements After the EAA 5.Opportunities for the Dominican Republic G. Other Treaties and International Agreements 1.Partial Trade Agreement with Panama 2.Central America 3.Caribbean Community 4.Other Bilateral Negotiations

VII.The Monetary and Financial System of the

Dominican Republic A. The Monetary and Financial System of the Dominican Republic 1.Background and Evolution

2.Legal Status 3.Important Aspect of Law No. 183-02 4.Organization of the Agencies of the Monetary

and Financial Administration a. The Monetary Board b. The Central Bank c. The Banking Superintendent 5.Financial Institutions, Local Offices and Foreign Financial Entities a. Financial Institutions b. Participation of Foreign Investment in the Dominican Financial Market; Representative offices 6.Dissolution of Financial Institutions B. Law on Money Laundering 1.Concept of Money Laundering 2.Evolution of Dominican Law 3.Definition of the Crime 4.Precautionary Measures 5.Penalties 6.National Committee Against Money Laundering C. Legislation Regarding the Stock Exchange 1.Agencies Regulating the Stock Exchange a. Superintendent of Securities b. National Securities Council 2.Parties Who Take Part in the Stock Exchange a. Stock Exchange b. Intermediaries in Securities Transactions c. Commodities Exchange d. Clearing House e. Centralized Securities Deposit f. Rating Agencies g. Mutual Funds

Closed Investment Funds i. Fund Managers j. Securitization Companies k. External Auditors l. Privileged Issuers 3.Procedures for Making a Public Offering a. Obtain Securitization from the Superintendent of Securities b. Inscription in the Registry of Securities and Commodities Exchange c. Placement and Negotiation 4.Incentives for Investments Through the Stock Exchange a. Tax Incentives b. Reliability c. Pension Funds 5.Penalties for Violation D. Regulation of Systemic Risk 1.Notions of Systemic Risk: Legal Status 2.The Program for the Prevention of Systemic Risks 3.The Bank Consolidation Fund 4.Procedure for the Application of the Program for the Prevention of Systemic Risks E. Laws on Insurance and Bonding 1.Generalities 2.Office of the Superintendent of Insurance 3.Participants and Bonding Market a. Insurers and Reinsurers b. Agents and Adjusters c. Guaranty Fund 4.Compulsory Insurance for Motor Vehicles 5.Appraisals and Appeals 6.Penalties

VIII. Legal Rules Relative to Foreign Nationals

Entering the Dominican Republic and Obtaining Residence Permits and Naturalization A. Foreign Nationals Can Enter the Country and Remain There Under Several Legal Categories 1.Nationality 2.Naturalization 3.Visas to Travel to the Dominican Republic 4.Residence Permits 5.Acquisition of Real Property

IX.Conflict Resolution
A. Structure and Organization of the Courts 1.The Legal System 2.The Judiciary 3.Constitutional Control and Defender of the

People B. Access to the Courts 1. Introduction 2.Civil and Commercial Litigation 3.Criminal Litigation 4.Litigation Involving Land a. Litigation Involving Registered Land b. Hearings and Judgment c. Land Courts d. Review in the Event of Fraud 5.Litigation Against the Government a. Jurisdiction of the Superior b. Administrative Procedures c. Preliminary Steps d. Time within which an Administrative Action Must Be Brought e. Preventive Measures

C. Alternative Dispute Resolution 1.Methods of Alternative Dispute Resolution

Mediation b. Conciliation c. Arbitration 2.Law No. 489-08 on Commercial Arbitration a. Non-Arbitrable Disputes b. The UNICTRAL Rules. 3.Law No. 50-87 on Chambers of Commerce 4.International Arbitration Organizations 5.Enforcement of Foreign Arbitral Awards a. General Provisions b. International Conventions. c. DR-CAFTA D. Enforcement of Creditors' Rights 1.Principal Security Interests a. Foreclosure of Mortgages. b. The Civil Law Pledge c. The Commercial Pledge d. The Chattel Mortgage or Pledge Without Dispossession e. The Pledge of Accounts Receivable f. Factoring g. Financial Leasing h. Conditional Sales Contracts i. Personal Guaranties. j. Real Guaranty k. Letters of Credit 2.Collection Procedures for Unsecured Creditors a. Pre-Judgment Liens b. Garnishment c. Other Remedies 3.Enforcement of Foreign Judgments 4.Bankruptcy and Insolvency